Baroness Hayter of Kentish Town
Main Page: Baroness Hayter of Kentish Town (Labour - Life peer)Enterprise Bill [HL]
Baroness Hayter of Kentish Town Excerpts“( ) relates to allegations of unfair treatment or unfair contracts,”
Baroness Hayter of Kentish Town (Lab)
I rise to move Amendment 14, standing in the names of my noble friends Lord Mendelsohn and Lord Stevenson, and speak to the others in this group.
When we debated the issue of micro-businesses as consumers within the then Consumer Rights Bill, we argued—and I think the Minister sort of agreed in principle—that micro-businesses should be treated as consumers where they are purchasing goods or services which are not their core business. I think the example we cited was that we would expect a hairdresser to be knowledgeable enough in their purchase of shampoo, hairdryers and scissors, and so not to expect the same level of protection as when we as individuals buy a hairdryer from Boots. However, when a hairdresser bought some coffee for the staff, or a kettle to make it, their right to return that kettle, should it be faulty, should be the same as for any of the rest of us. So, essentially, business-to-business purchases which a small trader would have with its main suppliers should not attract the same consumer protection, but its one-off, non-essential purchases, should be covered.
I believe that the Minister’s main argument at that point against our amendment was that the Consumer Rights Bill was not the right place for it—but a Bill encompassing a Small Business Commissioner surely is. We have a number of asks for these amendments, each of which seek to put a small or micro-business in a similar position to an ordinary consumer when purchasing goods or services not core to the business.
Baroness Hayter of Kentish Town
I thank the Minister for that and look forward to the letter—which may already be drafted, indeed.
I will deal with the issues in reverse order. The ADR issue is really interesting. There is the business-to-business one, which obviously is not free to the complainant. The interesting thing about the EU directive, of course, is that it is free to the consumer, and it is those areas where the business is acting like a normal consumer—the kettle, if you like—that we were very keen that the ADR directive should cover. I will come on to whether the Consumer Rights Act should cover small businesses. I have to thank the department very much for the work it is doing on this—the consultation and the meetings. If the consultation closed in June, I am slightly surprised that we have not had it yet. The word “autumn” was used. The clocks changed yesterday. I consider that it is now autumn.
The Minister knows better than I do the difficulty of getting any legislative time for changes. Should the consultation lead to the department thinking that it would be right to make some change, this is the right Bill to do that. I hope that that opportunity will not be lost, and if the response could be in a timetable that fitted with this, that would be really important.
Going back to the ADR providers, I was sorry to hear the reference to trade associations. The ADR directive is very clear that these bodies should be independent in this regard and I think that trade associations probably do not have that independence. However, that is by the by. I also regret the suggestion that having more ADR providers gives choice. As we have discussed, it gives choice only to the provider. The consumer can still go only to the one that the retailer or whatever says they use. There is always a danger of a rush to the bottom, with an ADR provider saying that it will look after complaints for 20p a complaint and another one doing it for 10p a complaint. That is not an area where competition operates well. I think that I have probably lost that argument but I leave that thought with the Minister.
I have only one other point to make in response to the Minister’s helpful comments and that is about getting better advice on whether a term should be void. I think she said that each business knows what is best for them. I think that the issue is a different one. It comes back to the lack of bargaining power, as the Minister said in relation to an earlier amendment. Somebody being offered three-month payment terms on an invoice may know jolly well that that is an unfair term and is silly and wrong, but they have no bargaining power. We were trying to strengthen their hand not as regards the business-to-business relationship but as regards very small businesses which are small fish in a very big tank, if you like.
We may want to come back to this measure. I will not push the Consumer Rights Act point until we have the response to the consultation but I hope that we can have it in time for it to be meaningful. If the idea is that we should move forward, it seems to me this is the right Bill in which to do it. In the mean time, I beg leave to withdraw the amendment.